Abstract/Description

The EU is to revise the basis for the calculation of tariffs applied to cereals...

Notes

The EU is to revise the basis for the calculation of tariffs applied to cereals and rice. The existing system is based on US commercial exchange prices, but in recent years new exporters have started to sell grain at prices well below other 'world market' prices. This has led to abnormally high EU imports of cereals and rice.
The new system of tariffs that the commission is proposing will be based on a more representative calculation of actual world-market prices. The new system may use fixed duties and tariff quotas, but will have to be negotiated with concerned exporters in the WTO. The Commission asserts that the EU has 'no intention to be more restrictive concerning access for cereals and rice to the EU market.' The aim it claims is merely to 'improve the system to more accurately fulfil our WTO obligations and protect our rights'.
The USA has complained about the new EU proposals, which it sees as restrictive. The Commission however sees it simply as an administrative measure designed to bring representative prices used for calculating import duties more into line with actual world-market prices. The Commission maintains that the new system will be WTO-compatible since it will be negotiated with the concerned trading partners.
Comment:
This EU measure follows high EU imports of cereals and demonstrates the willingness of the EU to revise its import regime whenever the implementation of the existing regime threatens the disruption of EU markets. Within the EU principles of liberalisation and open markets are always applied in the light of the practical realities.